Security Experts:

Cloudflare Plans to Acquire Email Security Startup Area 1

Web infrastructure and DDoS mitigation firm Cloudflare has announced plans to purchase Area 1, a Kleiner-Perkins-backed startup doing business in the competitive email security space.

The cash-and-stock deal, valued in the range of $162 million, adds technology for email protection to Cloudflare’s flagship cloud network and zero trust security platform and validates increased investor interest in the product category.

Based in Redwood City, Califl., Area 1 raised about $82 million from big-name investors like Kleiner Perkins and Forgepoint Capital and built technology to help businesses preemptively block phishing and email-borne malware threats.

Cloudflare chief technology officer John Graham-Cumming said the deal came together after his company started using Area1’s product to address its own email security needs.

[ News Analysis: The Race to Find Profits in Securing Email ]

Even though Cloudflare already offers email security tools, Graham-Cumming said Area 1's technology added a new protection dimension that opened his eyes to its capabilities.

"In fact, Area 1's technology was so effective at launch, that our CEO reached out to our Chief Security Officer to inquire if our email security was broken. Our CEO hadn’t seen any phishing attempts reported by our employees for many weeks, a rare occurrence," Graham-Cumming said.

"It turns out our employees weren’t reporting any phishing attempts, because Area 1 was catching all phishing attempts before they reached our employee’s inboxes," he added.

With the Area 1 acquisition, Graham-Cumming believes Cloudflare can push robust capabilities to its so-called Zero Trust security platform.

[ READ: Cloudflare Launches New Zero Trust Networking, Security Platform ]

"Imagine a world where you can turn on email security to protect you against phishing, but if for some reason an attacker were to get through to an employee's inbox, you can create a rule to open any unrecognized link in an isolated remote browser with no text input allowed and scan all email attachments for known malware. That is the power of what we hope to achieve," he added.

The planned deal is Cloudflare’s largest acquisition to date and the company said it expects to close early in the second quarter of 2022.  

Area 1 was founded in 2013 by Blake Darche (CSO), Oren J. Falkowitz (chairman), and Phil Syme (CTO). The first two were formerly NSA employees, while Syme was formerly chief engineer at Next Century Corporation. Patrick Sweeney recently joined the firm as CEO and president. Sweeney was formerly CEO at Talari Networks, which was acquired by Oracle in 2019.

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Related: Kleiner Perkins Leads $8 Million Investment in Area 1 Security

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Ryan Naraine is Editor-at-Large at SecurityWeek and host of the popular Security Conversations podcast series. Ryan is a veteran cybersecurity strategist who has built security engagement programs at major global brands, including Intel Corp., Bishop Fox and Kaspersky GReAT. He is a co-founder of Threatpost and the global SAS conference series. Ryan's past career as a security journalist included bylines at major technology publications including Ziff Davis eWEEK, CBS Interactive's ZDNet, PCMag and PC World. Ryan is a director of the Security Tinkerers non-profit, an advisor to early-stage entrepreneurs, and a regular speaker at security conferences around the world. Follow Ryan on Twitter @ryanaraine.